With the 7 June 2026 deadline for implementation of the EU Pay Transparency Directive deadline now passed, only 4 countries met the deadline: Italy, Lithuania, Malta and Slovakia, with Greece finalising its legislation shortly afterwards with a 1 November 2026 effective date.

Since our last briefing in early July 2026, Spain and Portugal have both published draft legislation. 

UPDATES ON DRAFT LEGISLATION

Spain

In July a draft of Spain's transposition was "leaked" from the Spanish Ministry. An official draft has now been published in August.

This is not yet the final text, so the conclusions of this summary may change as the text that is ultimately approved evolves. It should be noted that, as with the previous unofficial draft, certain issues such as pre-employment information remain unaddressed. As the draft itself states, this constitutes a partial transposition.

Key points: The most notable points are as follows:

• Companies must always have information available on how they pay their employees (rather than making it available on request).
• The record-keeping requirements have been expanded to include the obligation to maintain records based on job classification and standardised hourly rates.
• The pre-existing Spanish pay audit is confirmed as the key mechanism for identifying and correcting pay differentials. The deadline for rectification is extended to 6 months, compared with 2 months in the initial version.
• There is no reference to a prohibition on pay secrecy clauses.
• Existing pay audits remain valid until the end of their current validity period.

Summary of the key provisions and any key differences from the Directive:

• Definition of Pay level. Whilst in the Directive "pay level" refers to the amount employees receive, in the current wording this definition causes some confusion as it defines it as “the range, value or position assigned to a job or to an employee within the company's pay structure.”
• Pay and pay progression criteria. The duty of companies to "make available" pay criteria is transformed into an active obligation to "provide information" in a comprehensible and easily accessible manner, and even to keep the information up to date and make it available to employees again whenever the pay criteria, pay levels or, where applicable, the criteria for pay progression are subject to change.
• Pay register The current Spanish law requirement to draw up a pay register is extended to include both annual and hourly pay calculations. Among the requirements for companies obliged to carry out a Remuneration Audit as required by existing Spanish law, there is now a requirement for the register to be drawn up additionally in accordance with the job classification; it is no longer sufficient to comply with the general provisions applicable to all companies.
• Pay audit The purpose of the pre-existing pay audit has been reformulated, now defining it as a tool for assessing the pay situation and correcting unjustified inequalities. The content is restructured into a diagnosis (job evaluation, identification and analysis of differences, including the analysis of new factors such as the pay level and the information contained in the register) and an action plan, for which the maximum deadline for rectification is increased from two to six months and which incorporates a system for evaluating the effectiveness of previous measures. The company’s report on the audit is now to be addressed to the new Commission for Monitoring Pay Transparency, rather than the body responsible for equality matters. When identifying and analysing pay differences, account must be taken, as a minimum, of the information available for the last three years relating to:
  • The analysis of the proportion of employees, broken down by sex, in each group, professional category or pay band.
  • The information contained in the pay register, as well as any differences therein.
  • The reasons, if any, for such differences, based on objective and gender-neutral criteria. The company shall make the pay audit available to employees and their legal representatives. Similarly, the company shall notify the Commission for Monitoring Pay Transparency of the audit's completion.
• Employees' right to information  It is specified that the request may only be made once a year or whenever changes justify it. There are also data protection safeguards in the legislation.
• Lower threshold for Gender pay gap reporting. Companies with 50 or more employees that maintain a pay register must provide the Commission for Monitoring Pay Transparency with detailed information on the gender pay gap, on an annual basis (companies with 250 or more employees) or every three years (companies with between 50 and 249 employees).
• Commission for Monitoring Pay Transparency A tripartite collegiate body (comprising the Government, trade unions and employers' organisations) is established, chaired by the Secretary of State for Labour, with responsibilities for raising awareness, analysing the pay gap, compiling and publishing data, receiving pay audits, assisting in the exercise of the right to information and fostering institutional cooperation.
• Data processing A new article is introduced regarding the processing of data arising from the obligations under the legislation, requiring companies and the Commission to adopt technical and organisational measures, including data minimisation and control of access to information.
• Transitional Provisions: Adaptation of records and pay audits. Pay audits incorporated into equality plans in force on the date of entry into force of the legislation must be adapted to meet the new legislation’s requirements, at the latest, upon the expiry of their term of validity or when they are due for review. They will remain valid until then.
• Transitional provisions on gender pay gap reporting There is a transitional provision with phased deadlines for gender pay gap reporting (7 June 2027 for companies with 150 or more employees; 7 June 2031 for companies with between 50 and 149 employees). These differ from those in the Directive, given the lower employee thresholds.

Portugal

Draft legislation was published in early August in Portugal. In many respects, the proposal mirrors the wording of the Directive. However, the draft introduces certain features that are particularly relevant in the Portuguese context. We highlight below the following key measures:

• Obligation to adopt a transparent pay policy, agreed with employees’ representatives, where such representatives exist, and based on objective and gender-neutral criteria, namely skills, responsibility and working conditions and, where appropriate, any other factors relevant to the position or role.
• Transparency on hire: job candidates are entitled to information about the initial remuneration or the applicable pay range and the provisions of the collective bargaining agreement applicable to the position concerned, prior to the conclusion of the employment contract (in line with the Directive).
• Right to information: Expressly includes temporary agency workers assigned to the employer.
• Pay and Pay progression criteria: Companies with fewer than 50 employees are exempt.
• Lower threshold for gender pay gap reporting: There is an obligation for companies with 50 or more employees to report detailed information on gender pay gaps, including base salary, variable remuneration components and the distribution of employees across pay bands. This obligation must be complied with every three years by companies with 50 to 249 employees and annually by companies with 250 or more employees.
• Shorter period and defined process for remediating unexplained gender pay gaps: Introduction of a mechanism for the justification and correction of pay differences, with the intervention of the Portuguese Labour Authority (ACT), whenever pay disparities not justified by objective criteria are identified in the gender pay gap reporting. The proposal provides for a 90-day period for employers to justify or correct the identified pay difference and a 45-day period for ACT’s assessment. Pay differences that are not justified by the employer will be presumed discriminatory.
• Protection against retaliation: any dismissal or disciplinary sanction imposed within three years of the submission of a complaint relating to the exercise of rights concerning pay equality is presumed to be abusive.
• Expansion of the sanctions regime, which, in addition to administrative fines, may include ancillary sanctions such as:

1. Withdrawal of public benefits;
2. Revocation of tax and financial incentives;
3. Exclusion from public procurement procedures;
4. Mandatory training on pay transparency.

• Data disclosure: the entity within the Ministry responsible for labour matters and competent to process the relevant data (which we believe will be the Office for Strategy and Planning – GEP) will publish, on its website, by the end of the first half of each calendar year, information regarding pay gaps between men and women at national, regional, sectoral and employer-specific level, relating to the previous year.

Naturally, as this remains a draft legislative proposal subject to public consultation, the final text may still be amended. Nevertheless, the proposal appears to be a strong indication of how the Portuguese legislator intends to implement the Directive.

What This Means for You

These developments underscore that a uniform, "one size fits all" approach to the EU Pay Transparency Directive compliance across European operations may not be practicable. Country-specific nuances, particularly around definitions of pay, timelines, and reporting mechanics, will require careful consideration.

Your Contacts

At Deloitte, we understand that navigating the demands and complexities of pay equity and transparency can be daunting. Our proposition is designed to help you overcome this challenge and achieve your goals. Our aim is to enable you to pay employees equitably and help you demonstrate that you are doing so.

With our deep multi-disciplinary expertise in reward, employment law, technology & analytics, and behaviour change, we are well-placed to be your trusted partner on this journey. Get in touch to discuss your challenges and needs.

Kathryn Dooks, Partner, Deloitte Legal, 020 7303 2894

Deepinder Lamba, Partner, Deloitte Global Employer Services, 020 7007 2689

Note: The information provided is for general informational purposes only and may not be complete or up-to-date. Do not rely on this information without seeking professional advice. Deloitte LLP accepts no liability for any loss occasioned by any person acting or refraining from action as a result of this content